G.R. No.

201701

June 3, 2013

UNILEVER PHILIPPINES, INC., Petitioner,

vs.
MARIA RUBY M. RIVERA, Respondent.
DECISION
MENDOZA, J.:
Subject of this disposition is the petition for review on certiorari 1 under Rule 45 of the
Rules of Court filed by petitioner Unilever Philippines, Inc. (Unilever) questioning the
June 22, 2011 Decision2 and the April 25, 2012 Resolution3 of the Court of Appeals (CA)Cagayan de Oro City, in CA G.R. SP No. 02963-MIN, an Illegal Dismissal case filed by
respondent Maria Ruby M. Rivera (Rivera). The CA affirmed with modification the March
31, 2009 Resolution of the National Labor Relations Commission (NLRC) finding
Rivera's dismissal from work to be valid as it was for a just cause and declaring that she
was not entitled to any retirement benefit. The CA, however, awarded separation pay in
her favor as a measure of social justice.
The Facts
Unilever is a company engaged in the production, manufacture, sale, and distribution of
various food, home and personal care products, while Rivera was employed as its Area
Activation Executive for Area 9 South in the cities of Cotabato and Davao. She was
primarily tasked with managing the sales, distribution and promotional activities in her
area and supervising Ventureslink International, Inc. (Ventureslink), a third party service
provider for the companys activation projects. Unilever enforces a strict policy that every
trade activity must be accompanied by a Trade Development Program (TDP) and that
the allocated budget for a specific activity must be used for such activity only.4
Sometime in 2007, Unilevers internal auditor conducted a random audit and found out
that there were fictitious billings and fabricated receipts supposedly from Ventureslink

amounting to P11,200,000.00. It was also discovered that some funds were diverted from
the original intended projects. Upon further verification, Ventureslink reported that the
fund deviations were upon the instruction of Rivera.
On July 16, 2007, Unilever issued a show-cause notice to Rivera asking her to explain
the following charges, to wit: a) Conversion and Misappropriation of Resources; b)
Breach of Fiduciary Trust; c) Policy Breaches; and d) Integrity Issues.
Responding through an email, dated July 16, 2007, Rivera admitted the fund diversions,
but explained that such actions were mere resourceful utilization of budget because of
the difficulty of procuring funds from the head office.5 She insisted that the diverted funds
were all utilized in the companys promotional ventures in her area of coverage.
Through a letter, dated August 23, 2007, Unilever found Rivera guilty of serious breach of
the companys Code of Business Principles compelling it to sever their professional
relations. In a letter, dated September 20, 2007, Rivera asked for reconsideration and
requested Unilever to allow her to receive retirement benefits having served the
company for fourteen (14) years already. Unilever denied her request, reasoning that the
forfeiture of retirement benefits was a legal consequence of her dismissal from work.
On October 19, 2007, Rivera filed a complaint for Illegal Dismissal and other monetary
claims against Unilever.
On April 28, 2008, the Labor Arbiter (LA) dismissed her complaint for lack of merit and
denied her claim for retirement benefits, but ordered Unilever to pay a proportionate 13th
month pay and the corresponding cash equivalent of her unused leave credits. The
decretal portion of the LA decision reads:
WHEREFORE, premises considered, judgment is hereby rendered dismissing for lack of
merit the illegal dismissal complaint. However, UNILEVER PHILIPPINES, INC. is hereby
ordered to pay complainant the total amount of PESOS: FIFTY SEVEN THOUSAND
EIGHTY TWO & 90/100 ONLY (P57,082.90) representing proportionate 13th month pay
and unused leave credits.

The complaint against individual respondents Recto Sampang and Alejandro Concha are
likewise dismissed for it was not shown that they acted in bad faith in the dismissal of
complainant. Moreover, their legal personality is separate and distinct from that of the
corporation.

Unilever asked for a reconsideration of the NLRC decision. In its Resolution, dated
March 31, 2009, the NLRC modified its earlier ruling by deleting the award of separation
pay and reducing the nominal damages from P30,000.00 to P20,000.00, but affirmed the
award of retirement benefits to Rivera. The fallo reads:

All other money claims are dismissed for lack of basis.6

WHEREFORE, foregoing premises considered, the instant Motion for Partial

Reconsideration is PARTLY GRANTED. The Resolution dated 28 November 2008 of the
Commission is hereby

On appeal, the NLRC partially granted Riveras prayer. In its Resolution, dated
November 28, 2008, the NLRC held that although she was legally dismissed from the
service for a just cause, Unilever was guilty of violating the twin notice requirement in
labor cases. Thus, Unilever was ordered to pay her P30,000.00 as nominal damages,
retirement benefits and separation pay. The dispositive portion reads:
WHEREFORE, foregoing premises considered, the appeal is PARTIALLY GRANTED.
The assailed Decision dated 28 April 2008 is hereby MODIFIED in the sense that
respondent UNILEVER PHILIPPINES, INC. is hereby ordered to pay the following sums:
1. The amount of P30,000.00 representing nominal damages for violation of
complainants right to procedural due process;

RECONSIDERED as follows:
(1)The award of separation pay is hereby deleted for lack of factual and legal
basis; and
(2)The award of nominal damages is hereby tempered and reduced to the
amount of P20,000.00.
The rest of the award for retirement benefits is affirmed in toto.
SO ORDERED.8

2. Retirement benefits under the companys applicable retirement policy or

written agreement, and in the absence of which, to pay complainant her
retirement pay equivalent to at least one-half (1/2) month salary for every year of
service, a fraction of at least six (6) months being considered as one whole year;
3. Separation pay under the companys applicable policy or written agreement,
and in the absence of which, to pay separation pay equivalent to at least one-half
(1/2) month salary for every year of service, a fraction of at least six (6) months
being considered as one whole year.
The rest of the Decision is hereby AFFIRMED.
SO ORDERED.7

Unsatisfied with the ruling, Unilever elevated the case to CA-Cagayan de Oro City via a
petition for certiorari under Rule 65 of the Rules of Court.
On June 22, 2011, the CA affirmed with modification the NLRC resolution. Justifying the
deletion of the award of retirement benefits, the CA explained that, indeed, under
Unilevers Retirement Plan, a validly dismissed employee cannot claim any retirement
benefit regardless of the length of service. Thus, Rivera is not entitled to any retirement
benefit. It stated, however, that there was no proof that she personally gained any
pecuniary benefit from her infractions, as her instructions were aimed at increasing the
sales efficiency of the company and competing in the local market. For said reason, the
CA awarded separation pay in her favor as a measure of social justice. 9 The decretal
portion of the CA decision reads:

WHEREFORE, the assailed Resolution dated March 31, 2009 of the NLRC (Branch 5),
Cagayan De Oro City is hereby AFFIRMED with MODIFICATION. Consequently,
UNILEVER is directed to pay MARIA RUBY M. RIVERA the following:
a) Separation pay, to be computed based on the companys applicable policy or
written agreement, or in the absence thereof, the equivalent of at least one-half
(1/2) month salary for every year of service, a fraction of at least six (6) months
being considered as one whole year;
b) P20,000.00 as nominal damages; and
c) Proportionate 13th month pay and unused leave credits, to be computed
based on her salary during the period relevant to the case.
The award of retirement benefits is hereby DELETED.
SO ORDERED.10
Unilever filed a motion for partial reconsideration,11 but it was denied in a Resolution,
dated April 25, 2012.
Hence, this petition.12

II.
THE COURT OF APPEALS SERIOUSLY ERRED AND GRAVELY ABUSED ITS
DISCRETION IN AWARDING SEPARATION PAY IN FAVOR OF RIVERA
CONSIDERING THAT THE LATTER WAS VALIDLY DISMISSED FROM EMPLOYMENT
BASED ON JUST CAUSES UNDER THE LAW.
III.
THE COURT OF APPEALS SERIOUSLY ERRED AND GRAVELY ABUSED ITS
DISCRETION IN RULING THAT THE COMPANY VIOLATED RIVERAS RIGHT TO
PROCEDURAL DUE PROCESS BEFORE TERMINATING HER EMPLOYMENT, AND
CONSEQUENTLY, IN AWARDING NOMINAL DAMAGES.13
Unilever argues that Rivera did not file any separate petition for certiorari before the CA.
Neither did she file any comment on its petition. Hence, it was erroneous for the CA to
grant an affirmative relief because it was inconsistent with the doctrine that a party who
has not appealed cannot obtain from the appellate court any affirmative relief other than
the ones granted in the appealed decision. The petitioner stresses that Rivera
misappropriated company funds amounting to millions of pesos and that granting her
separation pay undermines the serious misdeeds she committed against the company.
Moreover, the length of her service with Unilever does not mitigate her offense, but even
aggravates the depravity of her acts.14

In support of its position, Unilever submits for consideration the following

The petition is partly meritorious.
GROUNDS
I.
THE COURT OF APPEALS SERIOUSLY ERRED AND GRAVELY ABUSED ITS
DISCRETION IN GRANTING AFFIRMATIVE RELIEFS IN FAVOR OF RIVERA EVEN IF
SHE DID NOT FILE ANY PETITION FOR CERTIORARI TO CHALLENGE THE NLRC
RESOLUTIONS.

The pivotal issue in the case at bench is whether or not a validly dismissed employee,
like Rivera, is entitled to an award of separation pay.
As a general rule, an employee who has been dismissed for any of the just causes
enumerated under Article 28215of the Labor Code is not entitled to a separation
pay.16 Section 7, Rule I, Book VI of the Omnibus Rules Implementing the Labor Code
provides:

Sec. 7. Termination of employment by employer. The just causes for terminating the
services of an employee shall be those provided in Article 282 of the Code. The
separation from work of an employee for a just cause does not entitle him to the
termination pay provided in the Code, without prejudice, however, to whatever rights,
benefits and privileges he may have under the applicable individual or collective
agreement with the employer or voluntary employer policy or practice.
In exceptional cases, however, the Court has granted separation pay to a legally
dismissed employee as an act of "social justice" or on "equitable grounds." In both
instances, it is required that the dismissal (1) was not for serious misconduct; and (2) did
not reflect on the moral character of the employee.17 The leading case of Philippine Long
Distance Telephone Co. vs. NLRC18 is instructive on this point:
We hold that henceforth separation pay shall be allowed as a measure of social justice
only in those instances where the employee is validly dismissed for causes other than
serious misconduct or those reflecting on his moral character. Where the reason for the
valid dismissal is, for example, habitual intoxication or an offense involving moral
turpitude, like theft or illicit sexual relations with a fellow worker, the employer may not be
required to give the dismissed employee separation pay, or financial assistance, or
whatever other name it is called, on the ground of social justice.
A contrary rule would, as the petitioner correctly argues, have the effect, of rewarding
rather than punishing the erring employee for his offense. And we do not agree that the
punishment is his dismissal only and the separation pay has nothing to do with the wrong
he has committed. Of course it has. Indeed, if the employee who steals from the
company is granted separation pay even as he is validly dismissed, it is not unlikely that
he will commit a similar offense in his next employment because he thinks he can expect
a like leniency if he is again found out. This kind of misplaced compassion is not going to
do labor in general any good as it will encourage the infiltration of its ranks by those who
do not deserve the protection and concern of the Constitution.
1wphi1

The policy of social justice is not intended to countenance wrongdoing simply because it
is committed by the underprivileged. At best, it may mitigate the penalty but it certainly

will not condone the offense. Compassion for the poor is an imperative of every humane
society but only when the recipient is not a rascal claiming an undeserved privilege.
Social justice cannot be permitted to be refuge of scoundrels any more than can equity
be an impediment to the punishment of the guilty. Those who invoke social justice may
do so only if their hands are clean and their motives blameless and not simply because
they happen to be poor. This great policy of our Constitution is not meant for the
protection of those who have proved they are not worthy of it, like the workers who have
tainted the cause of labor with the blemishes of their own character.19
In the subsequent case of Toyota Motor Philippines Corporation Workers Association
(TMPCWA) v. National Labor Relations Commission,20 it was further elucidated that "in
addition to serious misconduct, in dismissals based on other grounds under Art. 282 like
willful disobedience, gross and habitual neglect of duty, fraud or willful breach of trust,
and commission of a crime against the employer or his family, separation pay should not
be conceded to the dismissed employee."21 In Reno Foods, Inc, v. Nagkakaisang Lakas
ng Manggagawa (NLM)-Katipunan,22 the Court wrote that "separation pay is only
warranted when the cause for termination is not attributable to the employees fault, such
as those provided in Articles 283 and 284 of the Labor Code, as well as in cases of illegal
dismissal in which reinstatement is no longer feasible. It is not allowed when an
employee is dismissed for just cause."23
In this case, Rivera was dismissed from work because she intentionally circumvented a
strict company policy, manipulated another entity to carry out her instructions without the
companys knowledge and approval, and directed the diversion of funds, which she even
admitted doing under the guise of shortening the laborious process of securing funds for
promotional activities from the head office. These transgressions were serious offenses
that warranted her dismissal from employment and proved that her termination from work
was for a just cause. Hence, she is not entitled to a separation pay.
More importantly, Rivera did not appeal the March 31, 2009 ruling of the NLRC
disallowing the award of separation pay to her. It was Unilever who elevated the case to
the CA. It is axiomatic that a party who does not appeal, or file a petition for certiorari, is
not entitled to any affirmative relief.24 Due process prevents the grant of additional

awards to parties who did not appeal.25 An appellee who is not an appellant may assign
errors in his brief where his purpose is to maintain the judgment, but he cannot seek
modification or reversal of the judgment or claim affirmative relief unless he has also
appealed.26 It was, therefore, erroneous for the CA to grant an affirmative relief to Rivera
who did not ask for it.
Lastly, Unilever questions the grant of nominal damages in favor of Rivera for its alleged
non-observance of the requirements of procedural due process. It insists that she was
given ample opportunity "to explain her side, interpose an intelligent defense and adduce
evidence on her behalf." 27

(c) A written notice of termination served on the employee indicating that upon
due consideration of all the circumstance, grounds have been established to
justify his termination.
In case of termination, the foregoing notices shall be served on the employees last
known address.
King of Kings Transport, Inc. v. Mamac28 detailed the steps on how procedural due
process can be satisfactorily complied with. Thus:
To clarify, the following should be considered in terminating the services of employees:

The Court is not persuaded. Section 2, Rule XXIII, Book V of the Rules Implementing the
Labor Code expressly states:
Section 2. Standard of due process: requirements of notice.
In all cases of termination of employment, the following standards of due process shall
be substantially observed.
I. For termination of employment based on just causes as defined in Article 282 of the
Code:
(a) A written notice served on the employee specifying the ground or grounds for
termination, and giving to said employee reasonable opportunity within which to
explain his side;
(b) A hearing or conference during which the employee concerned, with the
assistance of counsel if the employee so desires, is given opportunity to respond
to the charge, present his evidence or rebut the evidence presented against him;
and

(1) The first written notice to be served on the employees should contain the
specific causes or grounds for termination against them, and a directive that the
employees are given the opportunity to submit their written explanation within a
reasonable period. "Reasonable opportunity" under the Omnibus Rules means
every kind of assistance that management must accord to the employees to
enable them to prepare adequately for their defense. This should be construed
as a period of at least five (5) calendar days from receipt of the notice to give the
employees an opportunity to study the accusation against them, consult a union
official or lawyer, gather data and evidence, and decide on the defenses they will
raise against the complaint. Moreover, in order to enable the employees to
intelligently prepare their explanation and defenses, the notice should contain a
detailed narration of the facts and circumstances that will serve as basis for the
charge against the employees. A general description of the charge will not
suffice. Lastly, the notice should specifically mention which company rules, if any,
are violated and/or which among the grounds under Art. 282 is being charged
against the employees.
(2) After serving the first notice, the employers should schedule and conduct a
hearing or conference wherein the employees will be given the opportunity to: (1)
explain and clarify their defenses to the charge against them; (2) present
evidence in support of their defenses; and (3) rebut the evidence presented

against them by the management. During the hearing or conference, the

employees are given the chance to defend themselves personally, with the
assistance of a representative or counsel of their choice. Moreover, this
conference or hearing could be used by the parties as an opportunity to come to
an amicable settlement.
(3) After determining that termination of employment is justified, the employers
shall serve the employees a written notice of termination indicating that: (1) all
circumstances involving the charge against the employees have been
considered; and (2) grounds have been established to justify the severance of
their employment.29
In this case, Unilever was not direct and specific in its first notice to Rivera. The words it
used were couched in general terms and were in no way informative of the charges
against her that may result in her dismissal from employment. Evidently, there was a
violation of her right to statutory due process warranting the payment of indemnity in the
form of nominal damages. Hence, the Court finds no compelling reason to reverse the
award of nominal damages in her favor. The Court, however, deems it proper to increase

the award of nominal damages from P20,000.00 to P30,000.00, as initially awarded by

the NLRC, in accordance with existing jurisprudence. 30
WHEREFORE, the petition is hereby PARTIALLY GRANTED. The June 22, 2011
Decision and the April 25, 2012 Resolution of the Court of Appeals (CA)-Cagayan de Oro
City in CA-G.R. SP No. 02963-MIN are AFFIRMED with MODIFICATION. The dispositive
portion should read as follows:
1wphi1

WHEREFORE, the March 31, 2009 Resolution of the NLRC (Branch 5), Cagayan de Oro
City, is hereby AFFIRMED with MODIFICATION. UNILEVER PHILIPPINES, INC., is
hereby directed to pay MARIA RUBY M. RIVERA the following:
a) P30,000.00 as nominal damages; and
b) Proportionate 13th month pay and unused leave credits, to be computed
based on her salary during the period relevant to the case.
The award of retirement benefit is DELETED.